Pdic

• REPUBLIC ACT NO. 3591 As amended by R.A. No. 9302; R.A. No. 9576; and R.A. No. 10846 AN ACT ESTABLISHING THE PHILIPPINE DEPOSIT INSURANCE CORPORATION, DEFINING ITS POWERS AND DUTIES AND FOR OTHER PURPOSES
• Philippine Deposit Insurance Corporation (PDIC)

  A public corporation created for the purpose of insuring deposits in all banks which are entitled to benefits
• PDIC is a public corporation because it is created by law, not a private corporation which is created by operation of law
• State policy


  Strengthen the mandatory deposit insurance coverage system to generate, preserve, maintain faith and confidence in the country's banking system, and protect it from illegal schemes and machinations
• Fiscal and administrative autonomy

  The power to create its own sources of revenue in addition to the equitable share in the general appropriation, and the power to allocate resources in accordance with its priorities
• Composition of the PDIC Board of Directors

  • Secretary of Finance (ex-officio Chairman)
  • Governor of the Bangko Sentral ng Pilipinas (ex-officio member)
  • President of the Corporation (Vice Chairman)
  • 4 members from the private sector (appointed)
• Qualifications to be appointed as member of the PDIC Board

  • Good moral character
  • Unquestionable integrity and responsibility
  • Person of known probity and patriotism
  • Recognized competence in economics, banking, finance, law, management, administration or insurance
  • At least 35 years of age
• Alternate representative of Secretary of Finance and Governor of Bangko Sentral

  Public official with rank not lower than Assistant Secretary or equivalent, with written authority
• Removal of appointed PDIC Board member

  1. Physical or mental incapacity lasting more than 6 months

  2. Guilty of fraudulent or illegal acts

  3. No longer possesses required qualifications

  4. Does not meet performance standards
• Quorum for PDIC Board meeting is 4 out of 7 members
• All PDIC Board decisions require concurrence of at least 4 members
• Powers of PDIC Board of Directors

  • Approve and issue rules and regulations
  • Act as policy-making body and constitute committees
  • Establish human resource management system
  • Approve compensation structure
  • Appoint, fix remuneration, and remove officers and employees
  • Approve policy on travel expenses
  • Adopt annual budget and authorize expenditures
  • Approve target level of Deposit Insurance Fund
  • Review and adopt organizational structure
  • Design and revise early separation plan for employees
• Asset


  Movable, immovable, tangible, or intangible resources or properties over which a bank has an established or equitable interest, including the proceeds of the sale of its bank and branch licenses subject to the approval of the Bangko Sentral ng Pilipinas
• Asset distribution plan


  Plan of distribution of the assets of a closed bank to its creditors, based on its estimated realizable value as of a certain cut-off date, prepared in accordance with the Rules on Concurrence and Preference of Credits under the Civil Code or other laws
• Board of Directors


  Board of Directors of the Corporation
• Bank and banking institution

  Banks, commercial banks, savings banks, mortgage banks, rural banks, development banks, cooperative banks, stock savings and loan associations and branches and agencies in the Philippines of foreign banks and all other corporations authorized to perform banking functions in the Philippines
• Closed bank


  A bank placed under liquidation by the Monetary Board
• Creditor


  Any individual or entity with a valid claim against the assets of the closed bank
• Deposit


  The unpaid balance of money or its equivalent received by a bank in the usual course of business and for which it has given or is obliged to give credit to a commercial, checking, savings, time or thrift account, evidenced by a passbook, certificate of deposit, or other evidence of deposit issued in accordance with Bangko Sentral ng Pilipinas rules and regulations and other applicable laws
• Accounts or transactions not covered by deposit insurance


  • Investment products such as bonds and securities, trust accounts, and other similar instruments
  • Deposit accounts or transactions which are fictitious or fraudulent
  • Deposit accounts or transactions constituting, and/or emanating from, unsafe and unsound banking practice/s
  • Deposits that are determined to be the proceeds of an unlawful activity
• Unlawful activity


  Any act or omission or series or combination thereof involving or having relation to the following: Kidnapping for ransom, Dangerous Drugs Act, Anti-Graft and Corrupt Practices Act, Plunder, Robbery and extortion, Jueteng and Masiao, Piracy on the high seas, Qualified theft, Swindling, Smuggling, Violations under the Electronic Commerce Act, Hijacking and other violations, Fraudulent practices and other violations under the Securities Regulation Code, Felonies or offenses of a similar nature that are punishable under the penal laws of other countries
• Disputed claim


  A claim or suit against the assets of a closed bank, or for specific performance, or breach of contract, or damages, of whatever nature or character, whether for money or otherwise, liquidated or unliquidated, fixed or contingent, matured or current, denied by the receiver
• Insured bank


  Any bank the deposits of which are insured in accordance with the provisions of this Act
• Insured deposit


  The amount due to any bonafide depositor for legitimate deposits in an insured bank as of the date of closure but not to exceed Five hundred thousand pesos (P500,000.00)
• Account


  Unpaid balance of money or its equivalent received by a bank in the usual course of business and for which it has given or is obliged to give credit to a commercial, checking, savings, time or thrift account, evidenced by a passbook, certificate of deposit, or other evidence of deposit issued in accordance with Bangko Sentral ng Pilipinas rules and regulations and other applicable laws
• Joint account


  • If the account is held jointly by two or more natural persons, or by two or more juridical persons or entities, the maximum insured deposit shall be divided into as many equal shares as there are individuals, juridical persons or entities, unless a different sharing is stipulated in the document of deposit
  • If the account is held by a juridical person or entity jointly with one or more natural persons, the maximum insured deposit shall be presumed to belong entirely to such juridical person or entity
• The aggregate of the interest of each co-owner over several joint accounts, whether owned by the same or different combinations of individuals, juridical persons or entities, shall likewise be subject to the maximum insured deposit of Five hundred thousand pesos (P500,000.00)
• No owner/holder of any passbook, certificate of deposit, or other evidence of deposit shall be recognized as a depositor entitled to the rights provided in this Act unless the passbook, certificate of deposit, or other evidence of deposit is determined by the Corporation to be an authentic document or record of the issuing bank
• In case of a condition that threatens the monetary and financial stability of the banking system that may have systemic consequences, as determined by the Monetary Board, the maximum deposit insurance cover may be adjusted in such amount, for such a period, and/or for such deposit products, as may be determined by a unanimous vote of the Board of Directors in a meeting called for the purpose and chaired by the Secretary of Finance, subject to the approval of the President of the Philippines
• Liquidation


  Proceedings under Sections 12 to 16 of this Act
• Liquidation court


  Regional Trial Court (RTC) of general jurisdiction where the petition for assistance in the liquidation of a closed bank is filed and given due course
• Payout


  Payment of insured deposits
• Petition for assistance in the liquidation of a closed bank

  Petition filed by the receiver with the RTC in accordance with Section 16 of this Act
• Purchase of assets and assumption of liabilities

  Transaction where an insured bank purchases any or all assets and assumes any or all liabilities of another bank under resolution or liquidation, as provided in this Act
• Receiver


  The Corporation or any of its duly authorized agents acting as receiver of a closed bank
• Records


  All documents, titles, papers and electronic data of the closed bank, including those pertaining to deposit accounts of and with the closed bank, its assets, transactions and corporate affairs
• Residual assets


  Assets, in cash or in kind, to be turned over to the closed bank's stockholders of record, in proportion to their interest in the closed bank as of date of closure, after payment in full of liquidation costs, fees and expenses, and the valid claims and surplus dividends to all the creditors
• Resolution


  Actions undertaken by the Corporation under Section 11 of this Act to: (1) Protect depositors, creditors and the DIF; (2) Safeguard the continuity of essential banking services or maintain financial stability; and (3) Prevent deterioration or dissipation of bank assets
• Risk-based assessment system


  Method for calculating an insured bank's assessment on the probability that the DIF will incur a loss with respect to the bank, and the likely amount of any such loss, based on its risk rating that takes into consideration: (1) Quality and concentration of assets; (2) Categories and concentration of liabilities, both insured and uninsured, contingent and noncontingent; (3) Capital position; (4) Liquidity position; (5) Management and governance; and (6) Other factors relevant to assessing such probability, as may be determined by the Corporation
• Statement of affairs


  Report of financial condition of the closed bank at a given date, showing: (1) estimated realizable value of assets; (2) classification of credits; and (3) estimated liabilities to be settled